This study examines the impact of board diversity on corporate ESG disclosures in India. An Indian sample of 149 firms from 2013 to 2023 included in the NSE 500 index is used for analysis. Building on prior literature, we propose a novel measure of board diversity that includes the proportion of former civil servants on boards, which may suggest modifications to existing board diversity frameworks. In addition, our study addresses a gap in the literature on emerging markets by analysing the role of foreign directors in influencing corporate ESG disclosures. We provide a nuanced understanding of this relationship by investigating the role of ESG-skilled boards in leveraging board diversity and find that board diversity improves ESG disclosures only when boards have ESG-skilled directors. In their absence, board diversity has no significant impact. We find that board diversity serves as a mechanism to improve ESG outcomes, but only when ESG skills provide the craftsmanship to translate board diversity into better ESG disclosures. Regulators may utilise diverse boards with ESG skills to achieve their sustainability targets. For investors, information about board diversity and ESG skills may serve as cognitive input to gauge a firm’s sustainable transition strategy and commitment. Firms may benefit from diverse boards in navigating increased demands for ESG information by regulators and stakeholders. The profiles of appointed directors can help investors and policymakers understand firms’ ESG commitments and identify the mechanisms through which board diversity translates into better ESG disclosures.
This study investigates the impact of corporate governance quality on firm performance, with special focus on the moderating effect of corporate social responsibility (CSR). The study examines the impact of aggregate CGP and its individual sub-indices on ROA and ROE, accounting-based measures of firm performance, and on Tobin’s Q, a market-based measure of firm performance, using the S P BSE 200 firms for the period 2010–2024. The results are based on the Feasible Generalised Least Squares (FGLS) estimation method and further verified by Fixed Effects and System GMM to ensure robustness. The findings suggest that overall CGP, as well as the majority of governance sub-indices, have a positive and significant impact on firm performance. CSR has a significant positive direct effect and a significant moderation effect on the relationship between CGP and firm performance. The moderating effect of CSR is heterogeneous at the sub-index level, with some governance sub-indices improving in performance, while others weaken or remain unchanged. The inferences highlight the synergistic effect of the governance-CSR link in promoting sustainable firm performance and have important implications for managers, investors, and policymakers in designing governance regimes that effectively incorporate social responsibility into corporate governance practices.
This study examines the effect of digital transformation on the ESG performance of banks in emerging markets, both directly and indirectly, across different ESG dimensions. The findings show a positive relationship between digitalization and the social dimension of ESG, particularly through enhanced financial inclusion. However, digitalization negatively affects the environmental and governance dimensions, due to increased energy use and oversight capacity gaps related to advanced technologies. The decomposition of a novel action-weighted digitalization index into technological foundations and technological applications reveals distinct effects, confirming the nuanced impact of digital tools while mitigating strategic “digital-washing”. Furthermore, the integration of net interest margin and bank age highlights how resource constraints and organizational inertia shape these outcomes, while strong regional regulatory quality attenuates governance deterioration. The results reaffirm the relevance of digitalization for both conventional and Islamic banks, though the intensity and direction of the impact vary between the two models.
As the global supply chain environment becomes increasingly complex, supply chain uncertainty has emerged as a significant risk to corporate sustainability. This study uses data on Chinese A-share-listed companies in Shanghai and Shenzhen over the period 2009–2023 to empirically examine the multidimensional impact of supply chain uncertainty on corporate ESG performance, using a fixed-effects model. The findings indicate that supply chain uncertainty significantly reduces corporate ESG performance. The mechanism-related results are consistent with the possibility that this relationship operates in part through higher transaction costs, greater cash holdings, and lower levels of technological innovation. Furthermore, heterogeneity analysis reveals that the negative effect of supply chain uncertainty on ESG performance is more pronounced for non-state-owned enterprises, firms in non-heavy-pollution industries, firms in industries with lower market concentration, and those facing lower levels of public environmental concern. The findings of this study offer both theoretical and practical implications for improving supply chain security and achieving the “dual carbon” goals.
This study investigates the impact of ethical governance mechanisms, specifically anti-bribery and corruption policies (PBCS) and whistleblower protection systems (WPS), on ESG performance in European listed firms. We also examine whether firm size (FS) mediates the relationship between governance practices and ESG outcomes. The study employs a multi-method empirical approach, utilizing fixed-effects panel regression, a system Generalized Method of Moments (GMM), and cross-sectional mediation analysis with Sobel-Goodman tests. Data were collected from 1,307 firms across 32 European countries for the period 2014–2023. Ethical governance variables were derived from Thomson Reuters Eikon and a governance index was constructed using principal component analysis. Both PBCS and WPS had a statistically significant and positive impact on ESG performance. Mediation analysis reveals that firm size partially mediates the PBCS–ESG relationship and fully mediates the WPS–ESG relationship. The findings are robust across panel, GMM, and cross-sectional models and confirm predictions based on Stakeholder Theory, Legitimacy Theory, and the Resource-Based View (RBV). This study contributes to the ESG and corporate governance literature by demonstrating how ethical governance policies influence sustainability performance and modeling the structural role of firm size as a mediator. It offers a novel, triangulated methodological framework, and contextualizes the results within the evolving European regulatory environment.
This study aims to examine the relationship between executive gender diversity (GENDMGT) and integrated reporting quality (IRQ) with the moderating role of ownership structure. We analyse firms listed on the Dhaka Stock Exchange (DSE) that adopted integrated reporting between 2015 and 2024, using ordinary least squares regression to test the proposed hypotheses. The results show that female participation in executive roles significantly improves IRQ. However, the effects vary across ownership structures: institutional ownership weakens, whereas foreign ownership strengthens, the positive association between GENDMGT and IRQ. Moreover director ownership plays insignificant role on that tie. Additional analyses indicate that female board representation further moderates this relationship, particularly when senior management includes at least three women, consistent with critical mass theory. This study contributes to the broader corporate governance (CG) literature by offering fresh evidence from an emerging economy on how gender diversity in top management affects integrated reporting outcomes. It also provides practical insights for firms aiming to enhance IRQ in largely voluntary reporting contexts. This study advances upper echelons, agency and stakeholder theory by evidencing the role of GENDMGT in enhancing IRQ, and espousing composition of executive suit especially gender enhances transparency through disclosure and pronouncing this affinity through external monitoring of managerial activities, gaining access to required external resources, information, and cutting-edge technology by the foreign investors. The outcomes also offer practical implications for policymakers and regulators to devise CG mechanisms by focusing on increasing women at executive suite, for stakeholders in assessing a firm’s accountability to society, and for analysts in predicting firm IRQ by analysing GENDMGT.
This study examines the effect of climate governance on the extent of green intellectual capital (GIC) disclosure and its components in an emerging economy, India. It also investigates whether corporate governance efficiency moderates the relationship between climate governance and GIC disclosure. The study uses a panel of the largest 100 non-financial firms selected from the top 500 companies listed on the Bombay Stock Exchange over the period 2018–2024. Data are collected from firms’ annual, integrated and sustainability reports and supplemented by the ACE Equity database. Climate governance is measured using a composite index based on widely adopted governance mechanisms. GIC disclosure is measured through manual content analysis using a binary coding approach. The hypotheses are tested using fixed-effects models with firm-clustered robust standard errors, with additional robustness analyses using system GMM and propensity score matching. The results show that climate governance is positively associated with the extent of overall GIC disclosure and its individual components. The strongest effect is observed for green structural capital disclosure, followed by green relational and green human capital. The findings further indicate that corporate governance efficiency strengthens the relationship between climate governance and GIC disclosure. The findings suggest that climate governance functions not only as a sustainability reporting mechanism but also as a means of identifying, coordinating and communicating environmental knowledge resources. The results further highlight the importance of governance efficiency in promoting more credible and substantive disclosure practices. This study contributes to the literature by extending attention beyond aggregate environmental disclosures to the reporting of environmental knowledge resources. It further provides evidence on how climate governance and corporate governance jointly shape GIC disclosure in an emerging institutional environment.
This study examines how board educational diversity shapes corporate ESG disclosure among Chinese A-share listed firms from 2014 to 2023. Drawing on upper echelons theory and agency theory, we conceptualize board educational diversity as a cognitive governance resource that enhances directors’ capacity to process complex sustainability-related information and support transparent disclosure. Using Bloomberg ESG disclosure scores, decomposed into environmental, social, and governance dimensions, and measuring educational diversity through the Blau index based on directors’ educational institutions and academic disciplines, we find that educationally diverse boards are positively associated with overall ESG disclosure and with each ESG dimension. However, director ownership weakens this positive relationship, suggesting that ownership-based incentives may constrain the translation of board cognitive capacity into disclosure transparency. Additional analyses show that the effect of educational diversity is stronger when directors also serve as executives and is more pronounced in regions with stronger educational infrastructure. The results remain robust when applying a Bartik shift-share instrumental variable approach to address potential endogeneity concerns. This study contributes to the disclosure and governance literature by showing that board educational diversity does not automatically enhance ESG transparency; rather, its effectiveness depends on the interaction between cognitive capacity, ownership incentives, managerial authority, and regional context.
Recent research has increasingly examined the relationship between Corporate Sustainability Accounting Practices (CSAP) and corporate ethics. However, while extensive theoretical background exists on CSAP, there remains a gap of rigorous empirical analysis addressing Tax Avoidance Practices (TAP) as ethical dilemmas within corporate settings. This study seeks to bridge this gap by theoretically and empirically investigating the relationship between CSAP and TAP in the global energy sector. Utilizing dual regression methods, this research analyzes panel data spanning from 2006 to 2022. The findings reveal a significant negative relationship between overall CSAP and TAP, a relationship further moderated by firms’ earnings strategies. A similar negative relationship is observed across the environmental and social dimensions of CSAP. However, when examining governance-related CSAP, the relationship with TAP is found to be statistically insignificant. Further analysis suggests a complex, inverted U-shaped relationship between governance-focused CSAP and TAP, also influenced by earnings strategies. These findings underscore the potential of enhanced CSAP—both in terms of quantity and quality—to mitigate tax avoidance. The study offers critical implications for policymakers, suggesting that strengthening CSAP frameworks may serve as a strategic mechanism to curb tax avoidance and promote ethical corporate behavior within the energy sector.
Capital-market regulation has long relied on disclosure as a central technique of investor protection. The orthodox assumption is familiar: once material information is disclosed, investors can price risk, market discipline can operate and regulators may intervene only at the margins. That assumption becomes fragile where disclosure exists formally but fails to clarify the legal, financial and governance meaning of risk. This article argues that disclosure adequacy should no longer be assessed only by asking whether information has been communicated, but whether it has been substantively articulated. Formal disclosure refers to the legally recognisable act of communicating information to the market. Substantive articulation, by contrast, requires disclosure to clarify the timing, attribution, materiality, risk trajectory and foreseeable consequences of a corporate event or condition. Drawing on recent scholarship on ESG disclosure, non-financial reporting, stock liquidity, cost of capital, corporate governance and stock price crash risk, the article develops a governance-oriented framework for distinguishing transparency from articulation. The revised article now specifies a model substantive articulation standard, defines its compliance elements, addresses legal-liability concerns through a safe-harbour principle, analyses institutional objections, and proposes a phased implementation roadmap. It argues that emerging capital markets often suffer not from the absence of disclosure rules, but from the coexistence of regulatory density and interpretive thinness. Under those conditions, disclosure may satisfy formal compliance while leaving investors exposed to unresolved uncertainty. The article contributes to disclosure and governance scholarship by proposing a shift from disclosure as communication to disclosure as legally bounded articulation.
The study examines how internal corporate governance—specifically, board independence and gender diversity—influences debt financing and insolvency risk in the emerging market context. Building on the perspectives of board monitoring and institutions, we develop our conceptual framework, emphasizing the role of internal board mechanisms in financial risk-taking. We used a sample of 986 limited companies for the period 2011 to 2020. We started our analysis using panel regressions to document the baseline association of board monitoring on debt financing and insolvency risk. Subsequently propensity score matched difference- in -diffeence (PSM-DID) model was used, to exploit the impact of governance reforms introduced under the Companies Act 2013 as a quasi-natural experiment and provide causal evidence on regulation induced changes. The PSM-DID results show that strengthened board monitoring, driven by regulatory changes, leads to a reduction in the use of debt financing and a decrease in insolvency risk among the treated firms. Further, we explored the two channels through which board monitoring might have achieved these outcomes, viz. substitution channel for board independence and underinvestment channel for board gender diversity. The results show that the board independence substitutes for debt monitoring in the post-regulation period, but board gender diversity does not lead to underinvestment. The findings contribute to the corporate governance literature by demonstrating how regulatory intervention influences the effectiveness of internal board mechanisms in shaping firms’ financial risk-taking behaviour. By integrating board monitoring with institutional and regulatory perspectives, the study highlights the complementary role of formal regulation in enhancing governance outcomes, particularly in emerging market environments. For policymakers, the results underline the importance of enforcing requirements for board independence and diversity, while firms and investors may also find value in enhanced board oversight as an avenue for mitigating excessive leverage and financial distress.
Corporate investment inefficiency is plaguing financial markets around the world. Drawing on the upper echelons theory, this study examines the viability of CEO-CFO tenure consistency as a remedial measure of investment inefficiency. Using a sample of 19,194 firm-year observations of A-share Chinese listed firms from 2010 to 2023, we find that CEO and CFO tenure consistency makes firms investment efficient. Moreover, we also find that financial flexibility moderates the nexus between CEO-CFO tenure consistency and investment efficiency. Our results remain robust to alternative estimation methods and measures of investment efficiency. Heterogeneity analyses reveal a more pronounced effect of tenure consistency on investment efficiency for non-state-owned, high-market competition facing, large-sized, and high-growth firms. Channel analysis suggests that risk-taking level and financial reporting quality are the channels through which tenure consistency affects investment efficiency. This study advances the investment and top management scholarship by defining CEO-CFO tenure consistency as a type of relational governance within the top management team that facilitates efficient capital allocation. Unlike preceding studies that fixated on independent executive tenure, this study exhibits that overlapping CEO-CFO tenure boosts coordination, monitoring, and information integration at the top of the firm, leading to IE enhancement.
This study investigates how coercive, normative, and mimetic institutional pressures, along with information asymmetry, influence the emergence of ESG-washing behavior. Using Kompas100 and non-Kompas100 Index firms as the sampling frame, a purposive survey was conducted among managers involved in ESG reporting, yielding 327 valid responses. Data were analyzed using partial least squares structural equation modeling (PLS-SEM). The findings indicate that all three forms of institutional pressure significantly drive ESG-washing, with information asymmetry being the most influential. This suggests that limited transparency and inadequate oversight amplify the tendency toward symbolic ESG disclosures rather than substantive ESG disclosure. By integrating institutional theory with the concept of information asymmetry, this study provides a novel empirical perspective on ESG-washing in emerging market setting. This study advances the understanding of how institutional and informational forces interact to shape corporate legitimacy strategies, offering implications for policymakers, regulators, and stakeholders concerned with improving ESG reporting credibility in developing economies.
This study investigates the effect of ownership concentration on firms’ ESG performance, emphasizing the moderating role of CSR committees. Using a panel of 242 French listed companies from 2009 to 2023, the study employs fixed-effects regressions, interaction models, and GMM robustness checks. Results show that concentrated ownership negatively affects ESG performance, consistent with agency theory, but this effect is mitigated in family firms and those with CSR committees. The impact also varies with external pressures such as market competition and regulatory changes like the Pacte Law. The study highlights the importance of CSR committees, the influence of family control, and provides evidence from a civil-law context with high ownership concentration, offering practical implications for policymakers and investors.
This study examines the effect of corporate environmental disclosure (CED) on corporate tax avoidance and investigates the moderating role of national culture based on Hofstede’s six cultural dimensions. Using an international sample of 2,286 non-financial firms listed in ESG indices over the period 2010–2024, this research provides cross-country evidence on how cultural factors shape corporate tax avoidance behavior. Financial firms are excluded due to their specific regulatory frameworks and capital structures, as well as firms with missing data. The empirical analysis uses feasible generalized least squares (FGLS) to address heteroskedasticity and serial correlation in panel data. Several robustness checks are conducted to validate the findings, including the use of alternative proxies for tax avoidance, the dynamic nature of the dataset is addressed using the Generalized Method of Moments (GMM) to control for endogeneity, and a comparative analysis across legal systems. The results reveal a significant negative relationship between corporate environmental disclosure and tax avoidance, indicating that firms with higher environmental transparency are less likely to engage in aggressive tax avoidance practices. Moreover, national culture plays a significant moderating role in this relationship. Power distance and masculinity strengthen the negative association between corporate environmental disclosure and tax avoidance, whereas individualism, uncertainty avoidance, and long-term orientation weaken this effect. Indulgence, however, does not exhibit a significant moderating influence. This study contributes to the literature on corporate environmental disclosure and corporate taxation by emphasizing the importance of cultural context. From a policy perspective, integrating responsible tax practices into environmental disclosure frameworks may enhance transparency and corporate accountability in an international setting.
The main purpose of this research is to examine the impact of sustainability-linked strategies like gender diversity of boards and carbon performance on stakeholder value of automotive corporations. Stakeholder value is conceptualized as a three-dimensional construct incorporating the social, environmental and governance values of organizations, which is of much relevance to a broad array of stakeholders including the employees, suppliers, consumers, government, and so on, apart from their shareholders. The sample includes listed automotive companies with ESG data availability in Refinitiv Eikon during the years 2016–2021 (1392 firm-year observations). The random effects model is employed for panel data analysis after confirming its appropriateness using the Hausman test. Robustness check was conducted using alternative variable specifications and methods. Further, potential endogeneity concerns were addressed by adopting GMM estimation. The results show a highly significant positive association between process-based carbon performance and stakeholder value. In contrast, the relationships between emissions-based carbon performance and stakeholder value, as well as board gender diversity and stakeholder value, are positive, though not statistically significant. The findings remain robust across alternate specifications and methods. This is one of the pioneering studies to explore the influence of sustainability-linked strategies—specifically gender diversity of boards and carbon performances on stakeholder value within global automotive industry. Drawing upon legitimacy theory and stakeholder theory coupled with gender socialization theory, and Porter’s hypothesis, this study establishes a framework to explore the interplay between sustainability-linked governance mechanisms and an overall performance value of a carbon-intensive industry. Utilizing a novel cross-country dataset, this study tackles a significant gap in the extant literature and contributes to theoretical advancements and practical implications to researchers, investors, business leaders and policy makers.
This study examines how corporate governance mechanisms and ownership structure influence information asymmetry among non-financial firms listed on the Amman Stock Exchange (ASE). Drawing on agency theory, institutional contingency theory, Query the principal–principal perspective, and structural information asymmetry theory, the study positions Jordan as a boundary-condition setting in which concentrated ownership, weak minority-investor protection, uneven enforcement, and limited market liquidity shape the effectiveness of governance mechanisms. Using hand-collected panel data for 108 non-financial ASE-listed firms over 2010–2022, information asymmetry is measured using bid-ask spread, zero-return days, and the Amihud illiquidity ratio. The baseline analysis employs year- and industry-fixed effects models, with two-stage least squares (2SLS) used as a robustness check for potential endogeneity. The results show that ownership concentration is positively and significantly associated with all three information asymmetry measures, making it the most consistent ownership-based predictor of market opacity. Managerial ownership is positively associated with bid-ask spreads, but not with zero-return days or illiquidity, suggesting that its effect is concentrated mainly in quoted trading frictions. The largest outside blockholder is negatively associated with zero-return days and illiquidity, indicating a partial monitoring role. Foreign and institutional ownership are not consistently associated with information asymmetry. Board-level mechanisms also show limited and inconsistent effects. Overall, the findings suggest that, in Jordan, ownership concentration and blockholder control are more relevant than formal board attributes in shaping the market information environment. The study contributes to emerging-market governance research by showing that standard agency-theory predictions depend on institutional context.
This paper presents a comprehensive systematic literature review on the impact of audit committee diversity on disclosure quality. The study adheres to the Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA) guidelines to select the journal publications included in the review. It examines 66 articles from 25 journals that are rated 3 and 4 stars by the Chartered Association of Business Schools Academic Journal Guide (AJG), published between January 2000 and July 2023. Theoretical findings from the review indicate that most of the articles rely on a single theoretical framework (i.e., agency theory) without thoroughly engaging with the hypotheses or the implications of their findings. Additionally, some papers do not clearly identify any theoretical foundation for their arguments. The systematic review literature highlights that 81
The consistency of ESG practices is crucial for corporate sustainability and governance. However, existing research mainly examines the economic effects of ESG disclosure while neglecting the impact of alignment between ESG disclosure and corporate actions on firm productivity. Using data from A-share listed companies in China (2014–2023), this study constructs an ESG Unity of Knowing and Action index and explores its effect on total factor productivity (TFP). The results show that: (1) A higher degree of ESG Unity of Knowing and Action enhances TFP, a finding robust across multiple tests; (2) This effect operates through improved accounting information comparability, reduced financing constraints, and optimized internal control quality; (3) The impact is more pronounced in non-state-owned enterprises, cross-listed firms, and large corporations; (4) When ESG performance is high, the positive effect weakens and may turn negative, indicating diminishing marginal returns. The findings provide novel theoretical insights and practical guidance for corporate ESG management and policymaking.
This study examines whether carbon emission disclosure (CED) is associated with earnings management–based financial reporting quality (FRQ) in Vietnam, with a focus on the mediating role of audit quality (AQ). Unlike prior studies employing aggregated ESG indicators, this study focuses specifically on carbon disclosure to assess how audit assurance shapes the credibility of environmental reporting. Using two-step system-GMM regression on 133 non-financial firms (2016–2022), the findings indicate that CED is negatively associated with FRQ in the absence of high-quality audit assurance, suggesting that voluntary disclosure may be used strategically alongside earnings management. Crucially, this adverse effect vanishes when firms engage Big 4 auditors, as AQ fully mediates the CED–FRQ link. These results provide new evidence for emerging markets and extend Signalling and Stakeholder theories by showing that strong audit assurance can turn voluntary carbon disclosure into real improvements in reporting credibility. The findings also have important practical implications. Indeed, policymakers must recognize that requiring disclosure without verification may backfire and potentially encourage greenwashing rather than accountability. For practitioners, the evidence highlights the importance of high-quality audits in enhancing the reliability and value of relevance of environmental disclosures. Overall, the study shows that credible audit assurance is a key mechanism for improving transparency and supporting the transition to a low-carbon economy.
